Was I Correct to Close My Successful Covered Call Trade? A Real-Life Example with Revolve Group, Inc. (NYSE: RVLV)

Was I Correct to Close My Successful Covered Call Trade? A Real-Life Example with Revolve Group, Inc. (NYSE: RVLV)

Dec 4, 2021 | Covered Call Exit Strategies, Exit Strategies, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

Alan K asked me to analyze a series of covered call trades he executed with RVLV over a 4-day period. Share price accelerated substantially once the trade was entered and a significant 4-day profit was realized. Let’s investigate all aspects of these trades....
Analyzing Covered Call Writing Trades to Enhance Our Trading Skills: A Real-Life Example with The Clorox Company (Nasdaq: CLX)

Analyzing Covered Call Writing Trades to Enhance Our Trading Skills: A Real-Life Example with The Clorox Company (Nasdaq: CLX)

Nov 27, 2021 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

One of the best ways to elevate our option-selling results is to analyze real-life trades. On August 3, 2021, Mark shared with me a series of trades he executed with CLX. His conclusion was that he was currently in a $250.00 net credit position. I will break down...
Rolling-Down to an ITM Strike in the Last Week of a Monthly Contract

Rolling-Down to an ITM Strike in the Last Week of a Monthly Contract

Nov 6, 2021 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

When we roll-down our covered call trades, we generally do so to an out-of-the-money (OTM) strike to allow for share price recovery. However, in the final week of a monthly contract, if we hold a security, we will not use in the following contract month, it frequently...
Explaining “Bought-Up” Value When Rolling a Covered Call Out-And-Up

Explaining “Bought-Up” Value When Rolling a Covered Call Out-And-Up

Oct 16, 2021 | Covered Call Exit Strategies, Exit Strategies, Investment Basics, Option Trading Basics, Options Calculations, Options Trade Execution, Stock Option Strategies

One of our key covered call writing exit strategies is rolling an option when the strike is in-the-money at expiration and we want to retain our shares. We can roll-out to the same strike at a later date or out-and-up to a higher strike at a later date. For both....
Exit Strategies for Covered Call Writing: “Hitting a Triple” with XLU

Exit Strategies for Covered Call Writing: “Hitting a Triple” with XLU

Oct 2, 2021 | Covered Call Exit Strategies, Exchange-Traded Funds, Exit Strategies, Investment Basics, Option Trading Basics, Options Trade Execution, Stock Option Strategies

Benefitting from exit strategies, in our covered call writing and put-selling portfolios, is the result of preparation and opportunity. Our 20%/10% guidelines for covered call writing protects us when share price declines and guides us as when to close the short...